Liberty Media Corporation Reports Second Quarter 2021 Financial Results

ENGLEWOOD, Colo.–(BUSINESS WIRE)–Liberty Media Corporation (“Liberty Media” or “Liberty”) (NASDAQ: LSXMA, LSXMB, LSXMK, FWONA, FWONK, BATRA, BATRK) today reported second quarter 2021 results. Headlines include⁽¹⁾:

• Attributed to Liberty SiriusXM Group
  • SiriusXM reported strong second quarter 2021 financial results
    • Second quarter revenue of $2.16 billion; an increase of 15% from prior year period
    • Second quarter net income of $433 million; diluted EPS of $0.10
    • Record quarterly adjusted EBITDA⁽²⁾ of $700 million, up 14% from prior year period
    • SiriusXM self-pay net subscriber additions of 355,000, an increase of 34% year-over-year
    • SiriusXM increased 2021 subscriber and financial guidance on July 27^th
  • Liberty Media’s ownership of SiriusXM stood at 78.1% as of July 23^rd
  • From May 1^st through July 31^st, Liberty repurchased 3.2 million LSXMA/K shares at an average price per share of $44.27 for total cash consideration of $141 million
• Attributed to Formula One Group
  • Announced Crypto.com as Global Partner and inaugural partner of the F1 Sprint series and expanded BWT partnership to become Official Water Technology Partner
  • Secured 3-year broadcast agreement in Netherlands with NENT Group beginning 2022
  • Successfully hosted inaugural F1 Sprint ahead of Silverstone Grand Prix
  • Repurchased $176 million principal amount of 2.25% AT&T exchangeable debentures in individually negotiated private purchases ahead of October 2021 put / call date funded primarily with sale of 5.3 million AT&T shares
• Attributed to Braves Group
  • Braves lead MLB in total attendance and average attendance per game

“SiriusXM executed well, produced outstanding results and recently increased their 2021 guidance. They continue to repurchase stock and Liberty’s ownership is now over 78%,” said Greg Maffei, Liberty Media President and CEO. “Formula 1 is delivering across the board – on the track, for our fans, teams, partners and investors, and has done an impressive job steering through the 2021 calendar. The Braves are competitive on the field and lead MLB in total attendance, with over 1.5 million fans returning to Truist Park so far this season.”

Discussion of Results

Unless otherwise noted, the following discussion compares financial information for the three months ended June 30, 2021 to the same period in 2020.

LIBERTY SIRIUSXM GROUP – The following table provides the financial results attributed to Liberty SiriusXM Group for the second quarter of 2021. In the second quarter, approximately $6 million of corporate level selling, general and administrative expense (including stock-based compensation expense) was allocated to the Liberty SiriusXM Group.

		2Q20				2Q21				% Change
		amounts in millions
Liberty SiriusXM Group
Revenue
SiriusXM		$	1,874			$	2,159				15	%
Total Liberty SiriusXM Group		$	1,874			$	2,159				15	%
Operating Income (Loss)
SiriusXM			398				640				61	%
Corporate and other			(15	)			(6	)			60	%
Total Liberty SiriusXM Group		$	383			$	634				66	%
Adjusted OIBDA
SiriusXM			615				699				14	%
Corporate and other			(12	)			(2	)			83	%
Total Liberty SiriusXM Group		$	603			$	697				16	%

SiriusXM is a separate publicly traded company and additional information about SiriusXM can be obtained through its website and filings with the Securities and Exchange Commission. SiriusXM reported its stand-alone second quarter results on July 27, 2021. For additional detail on SiriusXM’s financial results for the second quarter, please see SiriusXM’s earnings release posted to its Investor Relations website. For presentation purposes on page one of this release, we include the results of SiriusXM, as reported by SiriusXM, without regard to the purchase accounting adjustments applied by us for purposes of our financial statements. Liberty Media believes the presentation of financial results as reported by SiriusXM is useful to investors as the comparability of those results is best understood in the context of SiriusXM’s historical financial presentation.

The businesses and assets attributed to Liberty SiriusXM Group consist primarily of Liberty Media’s interests in SiriusXM, which includes its subsidiary Pandora, and Live Nation.

FORMULA ONE GROUP – The following table provides the financial results attributed to the Formula One Group for the second quarter of 2021. In the second quarter, the Formula One Group incurred approximately $4 million of corporate level selling, general and administrative expense (including stock-based compensation expense).

“Formula 1 is having an incredible season and the drama on the track is resonating with fans worldwide. The battle for the Championship is intense and very close, evoking memories of some of the sport’s greatest rivalries of the past,” said Stefano Domenicali, Formula 1 President and CEO. “We are seeing increasing numbers of fans tune in at home, and it is great to see the fans retuning to the races, with a sellout crowd at Silverstone of 356,000 across the weekend marking one of the largest fan events in the world since COVID. We were very pleased with the first Sprint event and look forward to the next one in Monza, and we continue to prove, despite the challenges presented by the pandemic, that we can adapt and find solutions for the remainder of the season.”

		2Q20				2Q21
		amounts in millions
Formula One Group
Revenue
Formula 1		$	24			$	501
Total Formula One Group		$	24			$	501
Operating Loss
Formula 1		$	(122	)		$	(36	)
Corporate and other			(14	)			(7	)
Total Formula One Group		$	(136	)		$	(43	)
Adjusted OIBDA
Formula 1		$	(16	)		$	66
Corporate and other			(10	)			(3	)
Total Formula One Group		$	(26	)		$	63

The following table provides the operating results of Formula 1 (“F1”).

F1 Operating Results

	2Q20				2Q21				% Change
	amounts in millions
Primary Formula 1 revenue	$	15			$	464			2,993		%
Other Formula 1 revenue		9				37			311		%
Total Formula 1 revenue	$	24			$	501			1,988		%
Operating expenses (excluding stock-based compensation included below):
Team payments		—				(308	)		NM
Other cost of Formula 1 revenue		(16	)			(90	)		(463	)	%
Cost of Formula 1 revenue	$	(16	)		$	(398	)		(2,388	)	%
Selling, general and administrative expenses		(24	)			(37	)		(54	)	%
Adjusted OIBDA (loss)	$	(16	)		$	66			NM
Stock-based compensation		(4	)			(5	)		(25	)	%
Depreciation and Amortization		(102	)			(97	)		5		%
Operating loss	$	(122	)		$	(36	)		70		%
Number of races in period		—				7

Primary F1 revenue represents the majority of F1’s revenue and is derived from (i) race promotion revenue, (ii) media rights fees (formerly referred to as broadcasting fees) and (iii) sponsorship fees.

Beginning January 1, 2021, F1 began reclassifying certain components previously reported in Other F1 revenue into Primary F1 revenue to better align with the way it currently evaluates the business. In addition, broadcasting revenue was renamed media rights revenue. The more significant components that were reclassified into Primary F1 revenue include fees for F1 TV subscriptions, fees for licensing commercial rights for Formula 2 and Formula 3 races, fees for the origination and support of program footage, fees for broadcast rights for Formula 2 and Formula 3 races and fees for advertising rights on Formula 1’s digital platforms. Following the reclassification, Other F1 revenue is primarily comprised of freight and hospitality revenue. $3 million of Other F1 revenue was reclassified as Primary F1 revenue for the three months ended June 30, 2020 to conform to the current period presentation. The impact of the revenue reclassification for the years ended December 31, 2019 and 2020 can be found in Schedule 3 of this press release.

There were seven races held in the second quarter of 2021, compared to no races held in the second quarter of 2020 due to the COVID-19 pandemic. Fan attendance continues to be assessed by relevant government authorities on a race-by-race basis. A very limited number of fans were in attendance and there was no Paddock Club hospitality at races in the second quarter. While final decisions are pending for most upcoming events, fan capacity increased beginning in the third quarter and the Paddock Club hospitality resumed operations beginning with the Austrian Grand Prix on July 4^th.

Primary F1 revenue increased in the second quarter with growth in race promotion, media rights and sponsorship fees. This was due to the recognition of race specific and season-based income with seven races held in the second quarter of 2021 compared to no races in the prior year period. Media rights fees also benefited from growth in F1 TV subscription revenue.

Other F1 revenue increased in the second quarter due to certain event-related activities associated with the seven races held in the current period compared to no races held in the prior year period, including higher freight, media and technical services, travel and Formula 2 and Formula 3 income. Licensing revenue also increased due to new contracts.

Operating loss decreased and adjusted OIBDA⁽²⁾ increased in the second quarter. Cost of F1 revenue increased primarily due to the recognition of team payments in the second quarter, as such payments are recognized pro rata with the race calendar and no races were held in the prior year period. Other cost of F1 revenue is largely variable in nature and mostly relates to revenue opportunities. These costs increased in the second quarter due to seven races taking place, which drove higher technical, travel, freight and logistics, Formula 2 and Formula 3 and other related costs. The proportionate recognition of a full year of FIA fees also contributed to the increase in other cost of Formula 1 revenue during the second quarter. Selling, general and administrative expense increased due to higher personnel cost as no bonus was accrued in the prior year period, as well as increased marketing expense.

The Liberty SiriusXM Group holds an approximate 2.2% intergroup interest (5.3 million notional shares) in the Formula One Group as of July 31, 2021. These shares are not included in the outstanding share count of Formula One Group in Liberty Media’s most recent Form 10-Q. Assuming the issuance of the shares underlying this intergroup interest, the Formula One Group outstanding share count as of July 31, 2021 would have been 237 million.

The businesses and assets attributed to the Formula One Group consist of Liberty Media’s subsidiary F1, its interest in Liberty Media Acquisition Corporation, other minority investments and an inter-group interest in the Braves Group.

BRAVES GROUP – The following table provides the financial results attributed to the Braves Group for the second quarter of 2021. In the second quarter, approximately $1 million of corporate level selling, general and administrative expense (including stock-based compensation expense) was allocated to the Braves Group.

		2Q20				2Q21
		amounts in millions
Braves Group
Revenue
Corporate and other		$	11			$	216
Operating Income (Loss)
Corporate and other		$	(33	)		$	31
Adjusted OIBDA
Corporate and other		$	(28	)		$	53

The following table provides the operating results of Braves Holdings, LLC (“Braves”).

	2Q20				2Q21				% Change
	amounts in millions
Baseball revenue	$	5			$	204			3,980		%
Development revenue		6				12			100		%
Total revenue		11				216			1,864		%
Operating expenses (excluding stock-based compensation included below):
Other operating expenses		(24	)			(142	)		(492	)	%
Selling, general and administrative expenses		(13	)			(20	)		(54	)	%
Adjusted OIBDA (loss)	$	(26	)		$	54			NM
Stock-based compensation		16				(2	)		NM
Depreciation and Amortization		(20	)			(20	)		—		%
Operating income (loss)	$	(30	)		$	32			NM
Number of home games in period		—				42
Baseball revenue per home game	$	N/A			$	4.9

There were 42 home games played in the second quarter of 2021 compared to no home games played in the comparable prior year period as the 2020 regular season was delayed until July of that year. The 2021 regular season began with fans in attendance at 33% capacity for the first home game beginning April 9^th, which increased to 50% capacity beginning April 23^rd and further expanded to 100% capacity beginning May 7^th.

Baseball revenue is comprised of (i) ballpark operations (ticket sales, concessions, corporate sales, retail, suites, premium seat fees and postseason), (ii) local broadcast rights and (iii) national broadcast rights, licensing and other shared MLB revenue streams. Development revenue is derived from the Battery Atlanta mixed-use facilities and primarily includes rental income.

Baseball revenue increased in the second quarter driven by the home games played in the current year and the recognition of revenue related to all primary sources of revenue, compared to no home games played in the comparable prior year period. Development revenue increased during the second quarter due to a reduction in deferred payment arrangements as well as increases in rental income from various new lease commencements.

Operating income and adjusted OIBDA increased in the second quarter. Revenue growth more than offset increased operating costs as player salaries and facility and game day expenses returned to more normalized levels in the current year. Selling, general and administrative expense increased primarily due to higher marketing expense.

The Formula One Group holds an approximate 11.1% intergroup interest (6.8 million notional shares) and the Liberty SiriusXM Group holds an approximate 3.7% intergroup interest (2.3 million notional shares) in the Braves Group as of July 31, 2021. These shares are not included in the outstanding share count of the Braves Group in Liberty Media’s most recent Form 10-Q. Assuming the issuance of the shares underlying these intergroup interests, the Braves Group outstanding share count as of July 31, 2021 would have been 61 million.

The businesses and assets attributed to the Braves Group consist primarily of Liberty Media’s subsidiary the Braves, which indirectly owns the Atlanta Braves Major League Baseball Club, three Professional Development League clubs, FCL Braves and certain assets and liabilities associated with the Braves’ ballpark and mixed-use development project.

Share Repurchases

From May 1, 2021 through July 31, 2021, Liberty SiriusXM Group repurchased approximately 2.3 million Series C Liberty SiriusXM shares (Nasdaq: LSXMK) at an average cost per share of $44.98 for total cash consideration of $103 million and repurchased approximately 887 thousand Series A Liberty SiriusXM shares (Nasdaq: LSXMA) at an average cost per share of $42.45 for total cash consideration of $38 million.

The total remaining repurchase authorization for Liberty Media as of August 1, 2021 is $766 million and can be applied to repurchases of Series A and Series C shares of any of the Liberty Media Corporation tracking stocks.

FOOTNOTES

1)		Liberty Media’s President and CEO, Greg Maffei, will discuss these headlines and other matters on Liberty Media’s earnings conference call that will begin at 10:00 a.m. (E.D.T.) on August 6, 2021. For information regarding how to access the call, please see “Important Notice” later in this document.
2)		For definitions of Adjusted OIBDA (as defined by Liberty Media) and adjusted EBITDA (as defined by SiriusXM) and applicable reconciliations see the accompanying schedules.

NOTES

The following financial information with respect to Liberty Media’s equity affiliates and available for sale securities is intended to supplement Liberty Media’s condensed consolidated balance sheet and statement of operations to be included in its Form 10-Q for the period ended June 30, 2021.

Fair Value of Corporate Public Holdings

(amounts in millions)		3/31/2021			6/30/2021
Liberty SiriusXM Group
Live Nation Investment(a)		$	5,895		$	6,100
iHeart(b)			127			188
Public Holdings(d)			—			50
Total Liberty SiriusXM Group(c)		$	6,022		$	6,338
Formula One Group
Public Holdings(d)			239			175
Total Formula One Group		$	239		$	175
Braves Group			NA			NA
Total Liberty Media		$	6,261		$	6,513

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a)		Represents the fair value of the equity investment in Live Nation. In accordance with GAAP, Liberty Media accounts for its investment in the equity of Live Nation using the equity method of accounting and includes it in its condensed consolidated balance sheet at $60 million and $0 as of March 31, 2021 and June 30, 2021, respectively. Fair value as of March 31, 2021 includes all shares of Live Nation owned with no adjustment to fair value for the 34.8 million notional shares underlying a call spread held at the Formula One Group, which was valued at approximately $384 million as of March 31, 2021 and was settled in April 2021.
b)		Includes fair value of iHeart shares, which are included in other long-term assets.
c)		Excludes Braves Group and Formula One Group intergroup interests.
d)		Represents the carrying value of other public holdings that are accounted for at fair value. Excludes Braves Group intergroup interest.

Fair Value of Intergroup Assets and Liabilities

The intergroup interests represent quasi-equity interests which are not represented by outstanding shares of common stock; rather, the Formula One Group and Liberty SiriusXM Group have attributed interests in the Braves Group, which are generally stated in terms of a number of shares of Liberty Braves common stock, and the Liberty SiriusXM Group also has an attributed interest in the Formula One Group, which is generally stated in terms of a number of shares of Liberty Formula One common stock. Each reporting period, the notional shares representing the intergroup interests are marked to fair value. The changes in fair value are recorded in the unrealized gain (loss) on the intergroup interest line item in the unaudited attributed condensed consolidated statements of operations. The intergroup interests will remain outstanding until the redemption of the outstanding interests, at the discretion of Liberty Media’s Board of Directors, through transfer of securities, cash and/or other assets from the Braves Group or Formula One Group, respectively, to the respective tracking stock group.

		Attributed
		as of June 30, 2021
		Liberty											Formula
		SiriusXM					Braves						One
		Group					Group						Group
(amounts in millions)		Notional Shares			Value		Notional Shares			Value			Notional Shares			Value
Braves Group intergroup interests		2.3		$	64		(9.1)		$	(253	)		6.8		$	189
Formula One Group intergroup interest		5.3		$	225								(5.3)		$	(225	)

Cash and Debt

The following presentation is provided to separately identify cash and liquid investments and debt information.

(amounts in millions)		3/31/2021				6/30/2021
Cash, Cash Equivalents and Restricted Cash Attributable to:
Liberty SiriusXM Group(a)(b)		$	1,038			$	1,550
Formula One Group(c)			1,783				2,225
Braves Group(b)			218				231
Total Consolidated Cash, Cash Equivalents and Restricted Cash (GAAP)		$	3,039			$	4,006
Debt:
SiriusXM senior notes(d)		$	7,750			$	9,750
Pandora convertible senior notes			193				193
1.375% cash convertible notes due 2023(e)			1,000				1,000
2.125% SiriusXM exchangeable senior debentures due 2048(e)			400				400
2.25% Live Nation exchangeable senior debentures due 2048(e)			385				385
2.75% SiriusXM exchangeable senior debentures due 2049(e)			604				604
0.5% Live Nation exchangeable senior debentures due 2050(e)			920				920
SiriusXM margin loan			875				875
Live Nation margin loan			—				—
Other subsidiary debt(f)			1,023				—
Total Attributed Liberty SiriusXM Group Debt		$	13,150			$	14,127
Unamortized discount, fair market value adjustment and deferred loan costs			533				543
Total Attributed Liberty SiriusXM Group Debt (GAAP)		$	13,683			$	14,670
1% cash convertible notes due 2023(e)			450				450
2.25% AT&T exchangeable senior debentures due 2046(e)			201				25
Formula 1 term loan and revolving credit facility			2,902				2,902
Other corporate level debt			73				71
Total Attributed Formula One Group Debt		$	3,626			$	3,448
Fair market value adjustment and deferred loan costs			127				164
Total Attributed Formula One Group Debt (GAAP)		$	3,753			$	3,612
Atlanta Braves debt			676				694
Total Attributed Braves Group Debt		$	676			$	694
Deferred loan costs			(4	)			(3	)
Total Attributed Braves Group Debt (GAAP)		$	672			$	691
Total Liberty Media Corporation Debt (GAAP)		$	18,108			$	18,973

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a)		Includes $67 million and $1.1 billion of cash, liquid investments and restricted cash held at SiriusXM as of March 31, 2021 and June 30, 2021, respectively.
b)		Includes restricted cash held in reserves pursuant to the terms of various financial obligations.
c)		Includes $429 million and $537 million of cash and liquid investments held at Formula 1 as of March 31, 2021 and June 30, 2021, respectively.
d)		Outstanding principal amount of Senior Notes with no reduction for the net unamortized discount.
e)		Face amount of the cash convertible notes and exchangeable debentures with no fair market value adjustment.
f)		Includes SiriusXM revolving credit facility.

Liberty Media, SiriusXM, Formula 1 and Braves Holdings are in compliance with their debt covenants as of June 30, 2021.

Total cash, liquid investments and restricted cash attributed to Liberty SiriusXM Group increased $512 million in the second quarter. Cash from operations at SiriusXM and net borrowings more than offset capital expenditures, return of capital at both SiriusXM and Liberty SiriusXM and approximately $384 million paid to the Formula One Group to settle the Live Nation call spread issued in connection with the reattribution between Liberty SiriusXM Group and Formula One Group in April 2021.

Included in the cash, liquid investments and restricted cash balance attributed to Liberty SiriusXM Group at June 30, 2021 is $1.1 billion held at SiriusXM. Although SiriusXM is a consolidated subsidiary, it is a separate public company with a significant non-controlling interest, therefore Liberty Media does not have unfettered access to SiriusXM’s cash balances. Liberty SiriusXM Group received $46 million of dividends from SiriusXM during the quarter.

Total debt attributed to Liberty SiriusXM Group increased $977 million during the quarter driven by net borrowings at SiriusXM. In June 2021, SiriusXM issued $2.0 billion principal amount of 4.0% senior notes due 2028. A portion of the net proceeds were used to repay borrowings outstanding under its credit facility, and SiriusXM used the remaining proceeds to fund the redemption of its 3.875% senior notes due 2022 after quarter-end. On August 2, 2021, SiriusXM priced an offering of $1.0 billion aggregate principal amount of 3.125% senior notes due 2026 and $1.5 billion aggregate principal amount of 3.875% senior notes due 2031. SiriusXM intends to use the net proceeds, together with cash on hand and borrowings under its credit facility, to redeem all of its 5.375% senior notes due 2026 and all of its 4.625% senior notes due 2024.

Total cash and liquid investments attributed to the Formula One Group increased $442 million during the quarter primarily due to proceeds received in the settlement of the Live Nation call spread and cash from operations at F1. Total debt at Formula One Group decreased $178 million in the quarter due to private repurchases of certain of Liberty Media’s 2.25% AT&T exchangeable senior debentures (the “AT&T exchangeable debentures”).

Contacts

Courtnee Chun (720) 875-5420

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